Have you ever considered what you would do if one of your clients had a severe allergic reaction to a facial product or procedure, even after a patch test? While very rare, these scenarios can happen and leave clinics vulnerable to insurance claims. In fact, a hefty legal bill or request for compensation can be devastating for a small business.
As a lifestyle and beauty journalist who has tried many different treatments, I’ve experienced reactions, both big and small, firsthand. Sometimes, facials have left me extremely irritated, and in one severe case, I was left with delayed onset pain after a body contouring treatment. (Yes, the very rare side effect that I was told about in the terms and conditions actually happened to me.) While I didn’t take things further by making a claim against the clinic, that may have been different if the symptoms had worsened or continued for an extended period of time.
While even the most experienced estheticians take steps to protect against accidents, you can help ensure your business is protected with the right insurance. So, if you’re not entirely sure what your insurance covers, or what the difference is between employer and personal coverage, it’s time to face it head on.
What Is Esthetician Insurance?
Esthetician insurance is professional liability insurance created for skincare professionals. This type of insurance helps protect your business in case a procedure or treatment goes wrong and a client experiences an extreme reaction, injury, or subsequent emotional distress. Some common examples where esthetician insurance may protect your business include if a client has a painful reaction after a chemical peel, or if a customer suffers an injury caused by your equipment, such as a burn from an IPL machine.
This type of insurance is much more specific to your trade than general liability insurance. General liability insurance covers you for smaller everyday accidents, such as a client slipping on a wet floor or a vendor falling while stocking product on a shelf using a stool. While a professional practitioner tries to avoid these sorts of issues, they can still occur. That’s why it’s vital to have esthetician insurance in addition to general liability to cover your professional services.
Why Estheticians Need Insurance: The Legal and Financial Reality
When talking about estheticians insurance, it’s important to understand all of the reasons why it’s needed.
State requirements
Many U.S. states require proof of liability insurance and an esthetician license in order for you to set up a beauty business. These requirements can differ between states, so you should always check them.
You may be asked for proof of liability insurance when renting a building or space for your clinic. If you travel to your clients and offer mobile services, this should also be taken into account when taking out insurance.
Lawsuit risks
You should be aware of the lawsuit risks that could affect your business. For instance, a chemical peel or wax could burn a client’s skin, or their skin may react to a product or laser. There are also rare side effects, such as delayed onset pain or unusual reactions to body treatments.
How Could a Claim Impact You Financially?
Wondering what a real-life claim could look like? Consider this: A client books an IPL treatment to remove unwanted hair. It’s a particularly rushed day and one experienced staff member is off sick, so you ask a more junior esthetician to do the treatment.
She isn’t properly supervised and puts the machine on the wrong setting. The result? Third-degree burns and a client claiming compensation for emotional distress and medical aftercare. The client wins the claim and receives a payout of over $45,000 to cover her medical bills and the stress it caused. These type of risks often fall under professional treatment liability (often referred to as esthetician malpractice insurance).
While you may believe that you and your team are careful enough to prevent something like this to happen, you can’t prevent every skin reaction or equipment malfunction. Sadly, accidents and reactions do happen.
Types of Coverage Estheticians Should Consider
Not sure which type of insurance you need? Here’s a guide on the basics.
Professional liability insurance
Estheticians typically need professional liability insurance to cover them for their professional services, which can result in errors, reactions, and accidents that may occur after a treatment. This should also cover equipment malfunctions, such as a laser becoming too hot, or a client having a reaction to a chemical peel.
General liability insurance
General liability insurance covers your business from more generalized incidents. These could include slip-and-fall accidents, damage to your property, or advertising injury claims. For instance, a customer may slip on a wet floor in your office and hurt their back, which means they can’t work for a period of time.
Product liability coverage
Product liability coverage protects you from any adverse reactions a client may have to a skincare product you have sold them. This could be due to defective product claims, or you might accidentally recommend something that didn’t suit the client. It could also just be a total one-off circumstance where a product caused a skin reaction.
Common Insurance Misconceptions
When it comes to estheticians insurance, there are a few common misconceptions you should be aware of.
Myth: “I’m careful, so I don’t need coverage.”
Fact: Even the most experienced and fastidious of clinicians can come up against problems. For instance, skin reactions can sometimes happen even after a patch test or when a client has had the same procedure before without issue. That’s why you should always have insurance, even if you’ve never had a claim made against you.
Myth: “Insurance only pays if I was negligent.”
Fact: This isn’t true. And even if an issue or accident wasn’t your fault — such as a client reacting to a chemical peel after a patch test — defending a claim can still be expensive and time consuming. Professional liability insurance can help cover your legal fees and costs, even if ultimately you’re found not liable for a customer’s injuries.
These types of misconceptions can leave estheticians personally liable for thousands of dollars, which can be incredibly damaging to a small business — not to mention stressful. That’s why it’s vital that you have the right insurance for you and your business and that you seek professional advice to ensure your policies cover all employees and treatments.
Insurance Costs and Coverage Limits
When choosing the right type of liability insurance for your beauty business, there are a few things to consider.
Cost
Firstly, you need to consider the cost and your budget. Insurance premiums vary by carrier and are determined by a number of factors including experience, type of work you do, business size, location, number of employees, and claims history.
Compare
Before committing to an annual plan, you should compare quotes from a number of insurers, and find the right fit for you. Having an insurance policy in place will help keep your business doors open. Whereas, one single claim can shut down a small business.
Getting Started: Your Insurance Checklist
Before you make a decision or start the process of choosing your liability insurance policy, refer to our handy checklist to make sure you’ve covered all bases.
Step 1: Research requirements and type of esthetician license needed for your state .
Step 2: Identify all the services you offer, including those provided by freelancers who may rent out rooms in your clinic, and confirm they have their own insurance coverage.
Step 3: View quotes before committing, and compare the different types of coverage available for a variety of skin reactions or potential accidents.
Step 4: Once you’ve decided on and purchased your policy, ask for a certificate of insurance (COI) for clients or landlords.
Step 5: Make sure you keep all of your insurance policies updated each year, especially as you add services and products to your roster.
Protecting Your Esthetics Business
There’s no doubt about it: A client having an adverse reaction to a product or treatment provided in your clinic is one of the biggest risks your business faces. By purchasing a robust insurance policy, you can have confidence that you’re protected. So, what are you waiting for? Secure your insurance today and give yourself peace of mind that you and your business are protected.
Compare esthetician insurance quotes today and find the right coverage for your business.